Philanthropy has long been important to many wealthy and affluent individuals and remains a growing trend in America. According to the Giving USA Foundation, donations amounts are on the rise as giving in the U.S. reached almost $400 billion in 2016, a 2.7% increase from the year prior. This is a good trend and I hope it indicates good news for our standing at the end of 2017.
The question becomes when we make charitable donations, are we doing it right? Are we managing our wealth and generosity, or what my firm calls “Social Capital”, in a way that is sustainable and in the long-term, beneficial?
“Most people who are charitably inclined are not driven to those activities because of tax benefits” says Kathy Muldoon, senior Vice Present of Carter Financial Management. “They are really motivated by core values in their household.”
I agree. Many of my clients are great and honorable people that are motivated by a belief in the mission of the organization they are donating to, believing that the gift can make a difference. Sometimes it’s a personal commitment and testament to their religious beliefs, a personal satisfaction of being part of solving societal ills, elevating the arts and sciences, or simply providing a needed lift for the less fortunate.
At Bailey Wealth Advisors, we believe that charitable giving, when developed as part of a strategic plan and implemented throughout the year - can be meaningful to you, your family and the causes you care about. We believe charity begins at home…that’s why we call it your “social capital.”
It’s never too late or too early in the year to begin turning your charitable motivations into a strategic giving plan of testamentary bequests, life insurance benefits, split interest gifts and on-going 'donor-advised funds.' These financial instruments help you to leverage your gifts and ensure that your own personal contribution impacts your charities directly in a way greater than you thought possible.
Eric D. Bailey, CFP®